Grain markets firm despite bearish US and European trend

Grain markets have firmed slightly in the past week, despite the bearish trend across Europe and the USA.

Old-crop milling wheat reached £200/t in some areas, although new-crop values lost about £4/t on the week to £146/t ex-farm for harvest. New crop feed wheat firmed by £4/t to about £128/t and oilseed rape values increased by about £2/t to £250/t for harvest movement.

With harvest progressing across the continent, barley yields looked good so far and although some wheat was suffering from heat stress, Strategie Grains increased its soft wheat forecast by 2m tonnes to 139.4m tonnes.

“The EU could, potentially, overtake the USA as the world’s top wheat exporter next season,” said a report by HGCA. “The USDA currently forecasts 2014-15 exports for the EU at 2.8m tonnes above the US prediction of 25.2m tonnes, as freight rates have affected US sales to Egypt, currently the world’s largest wheat importer.”

After two years of low export activity, the UK would have to return to the wheat export market this year, it added. “A key battle ground is likely to be displacing French wheat into Spain. To win back demand, quality and price competitiveness will be key.”